In the media

Don't confuse Germany's fiscal "black zero" with the "debt brake"

Mark Hallerberg and Jobst Fiedler explain in the FAZ why the debt brake offers scope for public investment.

Criticism of the German government's rigidly balanced budget, known as the "schwarze null," or "black zero", is justified, say Hertie School professors Mark Hallerberg and Jobst Fiedler in an op-ed for the Frankfurter Allgemeine Zeitung. Following the policy of a "black zero" leaves almost no room for much-needed public investment, for example in infrastructure like bridges, roads, schools, the transportation network, or programmes to reduce CO2 emissions. However, they say, critics often confuse the "black zero" - which is merely a political convention - with the debt brake - which is part of Germany's Basic Law. Abolishing the debt brake would be wrong, Hallerberg and Fiedler argue, because it is actually a flexible tool that allows significantly more scope for investment and measures to support the economic cycle than critics assume. In addition, as the population ages, the debt brake ensures that there is fiscal leeway for future generations, they say. Abolishing it would also require changing the country's constitution, while abandoning the "black zero" is merely a matter of changing political priorities. 

Read the full article in the print version of the Frankfurter Allgemeine Zeitung (in German).

More about Mark Hallerberg and Jobst Fiedler

  • Mark Hallerberg, Professor of Public Management and Political Economy
  • Jobst Fiedler, Professor Emeritus of Public and Financial Management